Question
I cant figure out the Gross Margin Ratio?? The following unadjusted trial balance is prepared at fiscal year-end for Nelson Company. NELSON COMPANY Unadjusted Trial
I cant figure out the Gross Margin Ratio??
The following unadjusted trial balance is prepared at fiscal year-end for Nelson Company. NELSON COMPANY Unadjusted Trial Balance January 31, 2018 Debit Credit Cash $ 1,000 Merchandise inventory 12,500 Store supplies 5,800 Prepaid insurance 2,400 Store equipment 42,900 Accumulated depreciationStore equipment $ 15,250 Accounts payable 10,000 Common stock 5,000 Retained earnings 27,000 Dividends 2,200 Sales 111,950 Sales discounts 2,000 Sales returns and allowances 2,200 Cost of goods sold 38,400 Depreciation expenseStore equipment 0 Salaries expense 35,000 Insurance expense 0 Rent expense 15,000 Store supplies expense 0 Advertising expense 9,800 Totals $ 169,200 $ 169,200 Rent expense and salaries expense are equally divided between selling activities and general and administrative activities. Nelson Company uses a perpetual inventory system. Additional Information: Store supplies still available at fiscal year-end amount to $1,750. Expired insurance, an administrative expense, for the fiscal year is $1,400. Depreciation expense on store equipment, a selling expense, is $1,525 for the fiscal year. To estimate shrinkage, a physical count of ending merchandise inventory is taken. It shows $10,900 of inventory is still available at fiscal year-end. 4. Compute the current ratio, acid-test ratio, and gross margin ratio as of January 31, 2018. (Round your answers to 2 decimal places.)
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